Trustees cave in under pressure from angry charities regulator

A call has been made for Shetlanders to boycott the forthcoming drive to recruit independent trustees to sit on the new-look Shetland Charitable Trust. The hope is that public revulsion towards the selection rather than election of a majority of trustees will force the charity regulator OSCR to step in and halt the reform plan.

The existing trustees voted 10-6 today to reluctantly accept the creation of a new trust made up of eight independents selected to serve with up to seven councillors. But although the template was created by the trust’s own reform group it appears nobody in the current trust now has faith in it. They agreed to ensure that the constitution is looked at again by an independent body with a view to more changes in 2017.

Trust vice-chairman Jonathan Wills led a forceful rebellion to defy OSCR and block the introduction of selected trustees, despite dire warnings of court action for misconduct if there was continued insubordination. He said trustees had been subjected to “intimidation, half-truths and coercion” by the charity regulator.

His hope was that a revised plan could be brought forward later this year to ensure most trustees were elected.

Today’s approval of the long-awaited reforms – which will be implemented in the next few months – was condemned as a sad day for Shetland by a number of trustees and the end of democratic control.

Trustee Gary Robinson – the council’s political leader – branded the reform “defective”. When the vote was lost he declared it was “the last democracy in the trust”.

He said he believed all the trustees knew that “the usual suspects” would come out and put themselves forward to join the trust. Once that happened he was sure there would be a public backlash against the reformed trust.

Earlier he was involved in a bad-tempered exchange with trust chairman Drew Ratter after Mr Ratter said he was “astonished” by the council leader’s involvement in trying to block the reform. The chairman was forced to retract the remark but even he criticised the demand for reform as another example of “the centralising impulse in Edinburgh”.

The decision means Shetland Charitable Trust will cease to exist in its current form within six months. Most of the 20 councillors who sit on it will stand down.

The meeting took place against a background of severe pressure from OSCR which had threatened to suspend trustees and grab the strings of the £200 million purse unless “positive, urgent” action was taken to reform the charity.

OSCR’s chief executive David Robb lost patience some time ago and repeated the threat last month after learning of continuing dissent over the changes agreed by the trust in December last year.

In a letter he accused Dr Wills and his supporters of “flouting” the findings of the trust’s own reform group by persisting with their call for the eight independent trustees to be elected by the people of Shetland instead of selected by a three-strong panel chosen by trustees.

Mr Robb suggested any trustees dissenting from the reforms approved by OSCR in July should consider their positions. He made it plain that misconduct proceedings could result if the trust did try to put forward an alternative reform proposal at this late stage.

The high-stakes intervention was the latest in a series of damaging skirmishes between Scotland’s biggest charity and its official regulator which has threatened repeatedly to take drastic action. It maintains close scrutiny of all trust business and requires to be kept fully informed of activities.

Last year the council convener Sandy Cluness resigned from the trust in protest at what he saw as moves by centralised forces to bring Shetland to heel. He had been prevented from mounting a referendum on trust reform by OSCR and he feared loss of council control would destroy the good work done in the community done by the trust since the 1970s.

Mr Robb said OSCR would prefer not to have to resort to action against trustees in the Court of Session but warned: “Should there be any delay implementing the approved reorganisation scheme, OSCR will proceed to examine the options available.”

At today’s meeting trustee Allan Wishart said he had bitter experience of Court of Session battles and warned that taking on the establishment at this point was “simply madness”.

The proposals for the new-look charity were finally approved by OSCR on 3rd July following four years of procrastination and delay by trustees and a long public consultation, which gave rise to 68 objections.

Since then OSCR has already castigated the trust for failing to rubber-stamp the change within two weeks of official approval.

Mr Robb expressed “considerable disappointment” that some of the trustees were still unwilling to proceed in the manner already agreed with OSCR.

The deadline for implementation is 31st March next year at the latest.

The trust’s legal adviser Simon Mackintosh from Turcan Connell confirmed to trustees that failure to implement the scheme would be treated “extremely seriously” by OSCR. Actions could include suspending trustees and staff, taking control of spending, freezing bank accounts and having the charity shut down with its assets transferred to another charity.

The job of recruiting members of the public to be trustees will now get under way immediately. The process will be conducted by trust chief executive Ann Black.

Turcan Connell said that once the new-look trust is in place the charity will at last be free to concentrate on its work rather than its internal structure and governance. It should be more secure against allegations of conflicts of interest and free to engage more confidently in business dealings with Shetland Islands Council.

Today’s high-tension proceedings were watched by councillor Billy Fox, the anti-Viking windfarm campaigner, who resigned from the trust in June. He sat on the sidelines at Islesburgh Community Centre next to Viking chairman Bill Manson. Mr Fox sported a home-made badge with the words “Shetland Charitable Trust Beneficiary” on one side which he turned around during certain trustees’ contributions to reveal the words “Viking Energy Trust Beneficiary” on the reverse.

Afterwards he said reports at the meeting were “the final piece in the jigsaw” to get “the usual suspects” onto the board of the trust and onto its company boards, particularly Viking’s.

“Since 2007 Shetland Charitable Trust’s business has been essentially driven according to the needs of Viking Energy.”

Today’s meeting involved 16 reports amounting to well over 300 pages but the documents were only released to the public and the media the day before.

13 comments

It would be good for the press to name and shame the objectionable 6 in the public domain, and no doubt we will find out soon, but I worry about the 7 who will be left in the trust, how will they be decided?

Surely, if Wills wants a democratic election, the 7 councillor positions should go out to the general public vote, to satisfy his power lust!!

I did indeed attend today’s Shetland Charitable Trust meeting wearing a badge displaying the capacity in which I was observing, a ‘SHETLAND CHARITABLE TRUST BENEFICIARY’, on the reverse I had ‘VIKING ENERGY TRUST BENEFICIARY ?’ (please note the ?), which I switched to once the vote on governance had gone through. Because that is what the SCT has now become – the Viking Energy Trust!

Since the SCT took over VE in 2007 it has been utterly driven by the company. Bill Manson as both chair of the Trust and Viking Energy made no move whatsoever to bend to OSCR’s ruling until it became apparent that conflicts of interest with 22 councillor trustees was making life extremely difficult when it came to achieving quorate meetings and drawing down finances for Viking Energy. It took a little while for the penny to drop but eventually it did. What could be better than to have a board consisting of 7 councillors and 8 selected trustees, a proposal built for cronyism and VE expediency. With a quorum of only 6 required even better, a split vote could be carried with the chairman’s casting vote and major financial decisions could be made by just 3 selected trustees, absolutely perfect.

The final piece in the jigsaw came in the next item on the agenda, namely the move to Nominee Directors taken from outside the trust for their subsidiary companies, SLAP, SHEAP, and of course Viking Energy Ltd. In the past these directorships have always been held by trustees, but the reasoning now is these companies have perhaps not performed as well as they could and more suitable external directors should be sought. In my opinion this has more to do with keeping Bill Manson on as chair of Viking Energy Ltd, which of course he still is, with Caroline Miller still also being a director despite no longer being trustees. Whichever way you dress this up public accountability diminishes even further.

So this has indeed been a sad day for democracy in Shetland, our charitable fund will now be controlled by an unelected and unaccountable majority, it will be interesting to see who comes forward for the role.

The truth is, there never ever was democracy in the SCT in the first place. Trustees have always been appointed by default of having being elected a councillor, there was nothing democratic about that. No member of the public has ever had the opportunity to directly elect a trustee on to the Trust.

The qualities one could argue that were desirable in a councillor, aren’t necessarily those desirable in a trustee, resulting in folk having the stark choice of voting for either a “good” councillor who wasn’t necessarily a “good” trustee, or a “good” trustee who wasn’t necessarily a “good” councillor.

All trustees should have been directly elected by the pubic right from the start, then there would never have been the decades of whispered insinuations of “interest conflicts”, or the current debacle with the OSCR.

That said, the SCT have had plenty of warning of what was coming, had the last lot of trustees taken the threat seriously and acted expediently on it, the current lot wouldn’t have been handed the hopeless and useless Hobson’s choice they had very little choice but rubber stamp today.

Mr Brown is clearly not himself, as the names of the six who opposed this craven surrender are printed on the report to which he refers. It is a pity he cannot write a letter without making himself ridiculous with pejorative phrases about “power lust”, because his suggestion that the public should elect trustees is not a bad one. It was, in fact, what I was suggesting this morning. If he could control his seething hatreds long enough to read your reporter’s very full and fair account of the meeting, he would know that. Very sad.

“The job of recruiting members of the public to be trustees will now get under way immediately. The process will be conducted by trust chief executive Ann Black”. Can someone explain – how are members of the public to be recruited as independent trustees, and who will approve/appoint them? Who are the “usual suspects” and who wishes to see them appointed? If, as Billy Fox is quoted, “since 2007 Shetland Charitable Trust’s business has been essentially driven according to the needs of Viking Energy”, it does not necessarily follow that any appointed independent trustee would give Viking Energy’s needs priority. If the trust’s business has been driven by Viking Energy’s needs it has been during the time that SIC councillors predominated as trustees. Newly appointed trustees would be independent of SIC. It is unfortunate that they are not democratically elected, but the selection and appointment process needs to be transparent. Who decides and by what process, how long will they serve, and can they be re-appointed???

Why would the councillors want ‘Shetlanders to boycott the forthcoming drive to recruit independent trustees to sit on the new-look Shetland Charitable Trust’ surely it is much better to have local people who have the best interests of Shetland to sit as trustees than someone from outwith the islands making decisions about what to do with our investments!!

The Education & Families Committee vote to support the motion to go for consultation on closures was won on the vote of a unelected representative not accountable to the shetland electorate – yet I hear no complaints about undemocratic process form Mr Wills or The Political Mr Robinson. Double standards?

I’m sure you realise the theory is that if “right-thinking” Shetlanders boycott the selection the “undemocrats” will be unable to withstand what Dr Wills refers to elsewhere as the “public opprobrium” associated with their position and will back down, handing over power to a new democratically-appointed regime.

I’m afraid we have already seen what happens when people “take their ball home,” either, by not turning up to important meetings, abstaining, voting against a compromise that isn’t their own and/or resigning and flouncing out dramatically – yes, they hand over power to the very ones they hope to shame with public opprobrium.

Correct me if I’m wrong, anyone, but hasn’t there already been a cacophony of public opprobrium and the “usual suspects” have sailed on, blithely ignoring it in the politicians’ way, en route to their goals.

We have seen, too, what happens when you say “heaven and earth will be moved” by the trust to resolve wind farm issues and simultaneously, give VE the full £6.3m they asked for when they will only say what they intend to do with £1.8m of it, even voting out a proposal to restrict the finance to £3m initially – yes, they summarily reject your polite request to address the issues.

These people are hard-nosed in a peculiarly “un-Shetland” kind of way and you will find that, like “undemocrats” around the globe, they will only give way when they are faced with equally hard-nosed business and/or political opponents.

I am put in mind of the Japanese commandant’s angry retort to Alec Guinness in “Bridge Over the River Kwai” – “This is WAR, not a GAME OF CRICKET!”

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